The UAE's crude oil production was 2.27 million barrels per day in the third quarter of 2002 (up from 1,260,000 barrels per day in 1985). Total reserves of crude oil were estimated at the beginning of 2002 at 97.8 billion barrels, or about 10% of the world's total. Production is confined to Abu Dhabi, Dubai, Sharjah, and Ra's al-Khaimah, which together had an estimated maximum daily capacity of 2.6 million barrels in 2002, giving the UAE the second-largest production capacity among Organization of the Petroleum Exporting Countries (OPEC) members (surpassed only Sa'udi Arabia). Abu Dhabi accounts for 94% of the total reserves, or about 92.2 billion barrels. Abu Dhabi's oil output comes almost exclusively from the onshore drilling activities of the Abu Dhabi Co. for Onshore Oil Operations (ADCO) and the offshore activities of Abu Dhabi Marine Operating Co. (ADMA-OPCO). Abu Dhabi has a 60% participation in the operations of both companies, which are managed by the government-owned Abu Dhabi National Oil Co. (ADNOC). The remaining 40% of ADCO's ownership is divided mainly among UK, US, and Dutch interests; the balance of ADMA-OPCO is owned by UK, French, and Japanese firms.
Offshore oil exploration by foreign companies has produced major new finds in recent years. Discovery of the offshore Butainah field in 1979 added about 1 billion barrels of oil to the UAE's proved reserves. That year, a US company, Amerada Hess, began producing crude oil at a rate of 15,000 barrels a day from the Arzanah offshore field. The Japan Oil Development Co. (JODCO), in partnership with ADNOC, began production at the offshore Umm ad-Dalkh field near Abu Dhabi in 1982. The two companies also agreed to develop three other small offshore areas, and both joined a French firm, CFP, to produce a projected 50,000 barrels of oil per day from the Upper Zakum field. The offshore Saleh field was found in 1983. As of 2002 ADNOC was planning to sell a 28% stake in the Upper Kakum field to foreign interests.
In 1981, Abu Dhabi and Dubai began to transfer up to half of their annual revenues from oil operations to the federation. The UAE's oil export receipts were $11 billion in 1999, down from $12.3 billion in 1985, and from $19.4 billion in 1980. Oil exports in 1995 accounted for 46% of total export revenue. In 2002, 60% of oil exports went to Japan.
The UAE has two major refineries in Abu Dhabi, both operated by ADNOC, as well as two smaller facilities. In addition, there is a new $300 million condensate refinery in Dubai that began operations in 1999. Refining capacity was 514,750 barrels a day at the beginning of 2002. The UAE's proven natural gas reserves totaled about 6 trillion cu m; net production amounted to 39.9 billion cu m in 2000. The second phase of the $1 billion Habshan onshore natural gas project was completed in early 2001.
All electricity is thermally generated from oil or natural gas. Electric power production was 36.3 billion kWh in 2000. Consumption of electricity in 2000 was 36 billion kWh. Total installed capacity in 2001 was 5.6 million kW. The first phase of the Taweelah A-2 cogeneration facility, the UAE's first independent water and power proejct, began operations in 2000.